Yes, it is a difficult decision – one that’s potentially worth thousands of dollars – and it’s a decision a typical family might have to face several times. The first time is when the kids arrive—most Americans buy a starter home, but when the children come along, it’s no longer big enough.
Next, the kids become teenagers and sharing bedrooms becomes an invasion of privacy. Then, within a few years, the next challenge is college. As the kids move away to school or their own homes, your big, teen-friendly house suddenly feels far too large. This is yet another time to decide whether to move or downsize by embarking on a remodeling project to convert Junior’s room into a home office or hobby space.
Finally, a family often faces the prospect of becoming caretakers for perhaps an ill spouse or an aging relative. It’s time for another change because the home needs to be more accessible.
Expensive as remodeling is, it’s very tempting to think that moving is the best decision. However, this can be far from the truth. When you move, it’s pure expense. There’s no payback. No matter where you move, you keep writing checks and the money is gone. You don’t increase your net worth – it’s vanished.
In comparison, a remodeling project can appreciate by $100,000 to $150,000 (according to an article on realestate.msn.com), depending on what changes you make. Note, however, that if remodeling makes sense, it’s important that you are financially ready for it.